Mumbai/New Delhi: The Delhi high court on Wednesday barred Mumbai-based Glenmark Pharmaceuticals Ltd from selling, distributing, marketing or exporting its anti-diabetes drugs Zita and Zita-Met, on the ground that they infringed the patent of US-based pharmaceuticals company Merck Sharp and Dohme Corp.

However, on a request from Glenmark, the court allowed it to dispose of its inventory through distributors and retailers. The inventory, worth ₹ 85 crore, is scheduled to run out by November end.

The patent dispute arose in 2013 when Merck moved the Delhi high court against Glenmark, alleging patent infringement. Justice Rajiv Sahai Endlaw had refused to pass an injunction order which was later reversed by a division bench.

According to Merck, sitagliptin phosphate monohydrate, the main component of Glenmark’s drugs, could not be made without manufacturing the active molecule sitagliptin, “invented and patented" by the US drug maker.

In a 133-page verdict, reviewed by Mint, Justice A.K. Pathak said that “it emerges from the comparison of the product inserts of the plaintiffs’ product (Merck’s Januvia and Janumet) and that of the defendant (Glenmark’s Zita and Zita-Met) that they are the same and contain the same compound, that is, sitagliptin phosphate monohydrate."

“We accept the honourable high court’s decision. We are evaluating our legal options at this point in time," an emailed statement from Glenmark said.

Making out a clear case of infringement by Glenmark, justice Pathak said, “(The) defendant is restrained by decree of permanent injunction from making, using, selling, distributing, advertising, exporting, offering for sale or dealing in sitagliptin phosphate monohydrate or any other salt of sitagliptin in any form, alone, or in combination with any other drug, thereby infringing patent of plaintiff".

“It appears (to be) a well reasoned order. And hopefully the US will now stop ranting against the Indian IP (intellectual property) regime saying that it is biased against IP owners. Indian courts have demonstrated that in a meritorious case, they will grant a patent injunction. On the patent infringement front, I think the court got it right. Also this case turned hugely on the expert witnesses. The judge found that the defendant witness was unreliable and stated so explicitly in the order. This case also shows that we can complete patent trials within three months. India has come of age with patent jurisprudence with this judgment," said Shamnad Basheer, founder of the intellectual property website SpicyIP and former IP chair at National University of Juridical Sciences, Kolkata.

Glenmark had contended that it was using sitagliptin in combination with another salt, namely phosphate in the form of sitagliptin phosphate, which grants it sufficient distinction in its chemical and physical properties.

While the court did not order Glenmark to pay any compensation to Merck, it did, however, ask the Indian firm to pay the US company the expenses arising out of the two-year-long litigation.

The judgment noted the price difference between the tablets offered by the two competitor companies but said that it could not be a ground for rejection of the injunction in view of the infringement.

On the aspect of pricing of generic drugs, Basheer said that in this particular case, the difference between the prices was not that significant from a public health perspective given the availability of substitutes. So, in terms of public interest, the injunction could not have been refused.

“Also if the government finds the prices still high, it can regulate through the price regulator. Patent decisions should not be the vehicle for price regulation," he said.

A spokesperson for Merck said: “MSD is pleased that the high court of Delhi has found Glenmark to be in infringement of the patent on our sitagliptin products."

On 15 May, the Supreme Court had restrained Glenmark from manufacturing Zita and Zita-Met—versions of its anti-diabetes drug—while it urged the Delhi high court to hear the dispute between the two pharmaceutical companies on a daily basis.

Merck sells the medicine to control type-2 diabetes under the brands of Januvia and Janumet. It also licenses the use of its patent to Sun Pharmaceutical Industries Ltd, which markets the product under the brand names Istavel and Istamet.

Anti-diabetes drugs are top sellers in India, where about 65 million people live with the disease. That number is expected to reach 100 million by 2030, according to The International Diabetes Federation (IDF), an alliance of national diabetes associations.

At the end of the trading day, Glenmark shares closed at ₹ 1,032.85, down 2.33%, on BSE, even as the benchmark Sensex gained 0.38% to 27,035.85 points.